Such an ownership structure holds at least one partner completely liable while other investors, especially sleeping partners, will be liable only to a fixed extent.

And unlike listed companies, these sleeping partners who may own a significant stake in a business, need not declare their holdings.

Toh Wee San, Senior Assistant Registrar, Accounting and Corporate Regulatory Authority, said: "Limited partnerships have been used for venture funds and ship financing in other countries. Personally, I think there is potential for more usage from other types of businesses. Because the LPs allows passive investors to invest and they enjoy limited liability. And there's a lot of privacy."

The idea to allow limited partnerships in Singapore was first mooted in 2003.

Officials then sought public consultation on a draft bill last August.